Africa urged to end dollar-based pricing for crude oil

The African Refiners and Distributors Association (ARDA) is pushing for an end to the dollar-based pricing of petroleum products across Africa, urging the continent’s 54 countries to prioritize energy independence and economic stability.
Speaking at the African Energy Week in Cape Town, Dr. Mustapha Abdul-Hamid, ARDA President and Chief Executive of Ghana’s National Petroleum Authority, outlined a roadmap to reduce Africa’s dependence on foreign currencies and imported refined oil, which he argued undermines economic stability.

Building an African energy infrastructure
Dr. Abdul-Hamid emphasized the need to invest in integrated infrastructure across the continent to reduce reliance on foreign energy sources.
He criticized Africa’s cycle of exporting raw crude oil only to re-import refined petroleum products at a premium, a practice that weakens local refineries and strains African economies.
“We have vast resources on our continent, yet we depend on imports for energy. This cycle must be broken,” he said, calling for closer collaboration between Africa’s oil-producing and refining sectors to harness the continent’s natural resources.
ARDA’s proposal includes developing pipelines, refineries, and storage facilities to serve Africa’s energy demands locally, which would help mitigate costs and insulate economies from international market fluctuations.

Harmonizing policies to promote Intra-African Trade
A lack of uniform standards in fuel quality across African countries currently hinders regional trade, according to Dr. Abdul-Hamid.
For instance, while Ghana has a fuel sulfur limit of 50 parts per million (ppm), some West African neighbors have limits as high as 3,000 ppm, creating a logistical barrier to trade.
“Without harmonized specifications, trade within the continent remains difficult, restricting our ability to collaborate effectively,” he said, urging for unified fuel standards to streamline imports and exports within Africa.

Introducing a regional currency
To address the economic strain of dollar-based pricing on African currencies, Dr. Abdul-Hamid proposed adopting a regional currency.
In Ghana, for example, oil marketers require $400 million monthly to import refined petroleum, which puts constant pressure on the Ghanaian cedi.
A shared currency within African regional blocs, he suggested, could ease the demand for U.S. dollars and support local economies.

Partnering for infrastructure and local refining
Omar Farouk Ibrahim, Secretary General of the African Petroleum Producers Organisation (APPO), reinforced the need to reduce Africa’s dependency on international markets by building domestic refining capacities.
Riverson Oppong, Chief Executive of the Association of Oil and Gas Marketing Companies, emphasized the paradox of Africa exporting up to 90% of its crude oil production while lacking sufficient refining capabilities for domestic use.
He pointed to a recent visit to Morocco, where he saw an idle refinery with the capacity to process 550,000 barrels daily, a “white elephant” that exemplifies Africa’s unfulfilled refining potential.
“Why are we sending our crude oil to Europe only to re-import it as refined fuel? This is compromising our economic stability and energy security,” Oppong stated.

A call for action
As Africa’s population continues to grow, the call to end dollarization in oil transactions and to build a self-reliant energy sector is becoming more urgent.
ARDA’s recommendations — policy harmonization, infrastructure development, and regional currency adoption — aim to create a stronger, more resilient African energy economy.
By developing domestic capacity and refining its own resources, Africa has the potential to achieve energy independence and strengthen its economies for the future.